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England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> CLP Holding Company Ltd v Singh & Anor  EWCA Civ 1103 (31 July 2014)
Cite as:  STC 214,  3 EGLR 101,  STI 3023,  BVC 40,  EWCA Civ 1103
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ON APPEAL FROM BIRMINGHAM COUNTY COURT
HHJ Oliver-Jones QC
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE KITCHIN
LADY JUSTICE GLOSTER
| CLP Holding Company Limited
- and -
|(1) Rajinder Singh
(2) Parvinder Kaur
WordWave International Limited
A Merrill Communications Company
165 Fleet Street, London EC4A 2DY
Tel No: 020 7404 1400, Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
James Quirke (instructed by Murria Solicitors Ltd) for the Defendants/Respondents
Hearing date: 24 July 2014
Crown Copyright ©
Lord Justice Kitchin:
"We are pleased to report that our clients' have signed the contract at a sale price of £130,000 in readiness for exchange. They have acknowledged that they have received all of the sale monies of £130,000 on this matter, subject to contract.
Our clients have informed us however that the purchaser will be paying our fees on this matter which amount to £350.00 plus VAT with £8.00 for office copies of the deeds and if you would please confirm that this is the case and that a special condition may be added to the contract of that effect we are able to exchange contracts."
5.1 Please state the exact amount payable on completion. If it is not just the balance purchase money, please provide copy receipts for any rental service charge or other payments being apportioned."
5.1 Balance of purchase monies."
"1. The Seller [the claimant] will sell and the Buyer [the defendants] will buy the Property for the Purchase price.
2. This Agreement incorporates the Standard Conditions of Sale (4th edition) ("the general conditions"). Where there is a conflict between the general conditions and this Agreement or the general conditions are not consistent with the express terms of this Agreement, this Agreement shall prevail. Terms used or defined in this Agreement have the same meaning as in the general conditions save as otherwise defined in this Agreement."
"(i) In the event of default by either party on Completion and the serving of a valid Notice to complete by the non-defaulting party's solicitor the defaulting party will pay (but without prejudice to any other rights and remedies of the non-defaulting party) the sum of £100 plus VAT in respect of the non-defaulting party's solicitors additional costs.
(ii) In addition to the compensation referred to in condition 7.3.2 the Seller will also be entitled to a refund of any fees, commission and interest incurred in obtaining Bridging Finance for a sum not exceeding the unpaid balance of the purchase price."
"12. This Contract constitutes the entire contract between the parties and may only be varied or modified (whether by way of collateral contract or otherwise) in writing under the hands of both parties or their respective solicitors by letter or memorandum attached to both parts of the original Contract. The Buyer acknowledges that he has not entered into this agreement in reliance wholly or partly of [sic] any statement or representation made by or on behalf of the Seller save written replies to preliminary enquiries before contract and other written statements by the Seller's solicitors."
"1.4.1 An obligation to pay money includes an obligation to pay any value added tax chargeable in respect of that payment.
1.4.2 All sums made payable by the contract are exclusive of value added tax."
"Completion does not cancel liability to perform any outstanding obligation under this contract."
"Normally of course it will be made clear expressly. It is in the interests of the builder who will be receiving the price to make it clear because, as between the builder and the Commissioners for Customs and Excise, the provisions now found in section 19(1) and (2) of the Value Added Tax Act 1994 require the recipient to account for value added tax on the basis that the consideration that he receives is such amount as equals the value of the goods or services plus value added tax. So if the builder fails to make it plain to the employer that he is stipulating for the payment of value added tax in addition to the contract price, he will be left to account to the Revenue for the value added tax out of what he receives."
"The Deputy District Judge, in effect, concluded that there was no conflict between the Agreement [the special conditions] and the General Conditions. In my judgment he was wrong to do so and failed to have regard to the fact that the consideration for this transaction was clearly stated in the agreement to be £130,000. If the words 'plus VAT' had been added to the figure of £130,000 on the definitions-page of the Agreement which defined the purchase price, then there would have been no conflict with clause 1.4 of the General Conditions. Both the requisition on title and the transfer document submitted to the Land Registry make it clear that the consideration for the purchase was money in the sum of £130,000. Even if one were to ignore the requisition and Land Registry document, the purchase price is, as I say, defined in the agreement."
"Therefore, in identifying the purchase price as being £130,000 without specifying that VAT should be added, the agreement was inconsistent with the terms of general condition 1.4(2) that all sums payable by the contract are exclusive of VAT. There is no inconsistency with 1.4(1) because all that says is that an obligation to pay money viz. £130,000, includes an obligation to pay any VAT chargeable in respect of that payment. The VAT chargeable is calculated in accordance with section 19(2) and has been paid by the defendant. So there is nothing due and owing."
"7, Value Added Tax, Sums payable under this agreement for the supply of goods and services are exclusive of Value Added Tax on the payment."
The sale agreement, a draft of which was attached to the option agreement, provided by clause 1:
"In this agreement the Purchase Price means £400,000."
And by clause 3:
"The seller shall transfer to the purchaser the Property on the Completion Date for the Purchase Price."
"The purchase price for the freehold property shall be the sum of two million nine hundred and thirty five thousand pounds (£2,935,000) exclusive of VAT. The vendor undertakes and warrants that that no election to charge VAT has been or will (prior to completion) be made by it in respect of the freehold property and accordingly no VAT will be payable by the purchaser on completion."
Lady Justice Gloster:
Lady Justice Arden: